Arnold D. Kamen & Co. v. Young

• Decision Date: 09 April 1971
• Docket Number: No. 17595,17595
• Citation: 466 S.W.2d 381
• Parties: ARNOLD D. KAMEN & CO. et al., Appellants, v. Harold S. YOUNG, Appellee.
• Court: Texas Court of Appeals

Page 381

466 S.W.2d 381

ARNOLD D. KAMEN & CO. et al., Appellants, v. Harold S. YOUNG, Appellee.

No. 17595.

Court of Civil Appeals of Texas,

Dallas.

April 9, 1971.

Rehearing Denied April 30, 1971.

Joe B. Abbey, Haynes & Boone, Dallas, for appellants.

Nathan Allen, Jr., Hunter, Greenfield & Allen, Dallas, for appellee.

CLAUDE WILLIAMS, Chief Justice.

This action was brought by Harold S. Young against Arnold D. Kamen & Co., a partnership, and Arnold D. Kamen individually, seeking to recover commissions alleged to be due and unpaid arising out of his employment with the company as manager of its commodity brokerage office in Dallas. Both the partnership and Kamen answered and alleged that on or about August 28, 1967 an oral agreement had been entered into whereby Young was to become manager of the branch office of the partnership in Dallas for which he was to be paid a graduated percentage of the commissions realized on sales by Young, plus a percentage of the commissions of any salesmen which Young hired, less one-half of the expenses attributable to the Dallas office. It was further alleged that by the terms of the oral agreement 100 per cent of 'any customer's deficit balances in the Dallas office' would be subtracted from Young's net commissions; that Young failed to maintain margin requirements of his customers and incurred deficits in the total amount of $34,382.80 and that after deducting the said losses from Young's gross commissions due he was not entitled to recover any commissions. Young responded to these pleadings by specifically denying that he had agreed to assume 100 per cent of customer deficits and further pleaded that any loss sustained by Kamen came about or resulted from conduct and actions of and directed by Kamen individually for which Young would have no legal responsibility.

The case was tried to the court and a jury. The parties stipulated that Young had earned $87,284.66 gross commissions during the years 1967 and 1968 while employed as manager for Kamen. It was also stipulated that Young would accept certain sums as proper deductions from his gross commissions.

The case was submitted to the jury on three special issues. Issue No. 1 inquired as to the amount of Dallas office operational expenses of Kamen which Young had agreed to share equally with Kamen as charges against his gross commissions. The jury responded '$24,264.77'. Issue No. 2 asked the jury to find whether Young had agreed with Kamen 'that 100% Of any customer deficit balances, if any, of the Dallas office of Arnold D. Kamen & Co., would be deducted from commissions due Harold S. Young?' To this the jury answered 'Yes'. In Issue No. 3 the court asked the jury to find the total amount of Dallas office customer deficit balances which should be deducted from Young's commissions under the agreement they may have found in answer to Special Issue No. 2. The jury answered '$7,758.40'. Based upon this verdict, together with stipulations, the court entered judgment for Young against both defendants for $13,814.14, together with interest, attorney's fees and costs.

In eleven points of error appellants challenge the judgment. We find that we cannot consider appellants' Point of Error No. 2 relating to alleged improper comments of counsel during the trial for the reason that the matters complained of were not presented to the trial court in the motion for new trial. In a case tried before a jury errors which are not brought to the attention of the court upon presentation of a timely and properly filed motion for new trial are waived and are not preserved for appellate review. Rule 374, Vernon's Texas Rules of Civil Procedure; Wagner v. Foster, 161 Tex. 333, 341 S.W.2d 887 (1960); and Cain v. Zurich Insurance Company, 426 S.W.2d 575 (Tex.Civ.App., Dallas 1968).

In their Point No. 1 appellants contend that the answer of the jury to Special Issue No. 3 is contrary to the great weight and preponderance of the evidence. Our judicial review of this point requires us to examine and consider all of the evidence relevant to the jury finding. In re King's Estate, 150 Tex. 662, 244 S.W.2d 660 (1951). We have complied with this rule and summarize briefly the material testimony.

Appellant, Arnold D. Kamen & Co., is a commodity brokerage company and a member of the Chicago Mercantile Exchange. Its main office is in Chicago, Illinois with branch offices in other cities throughout the United States. During the latter part of August, 1967 appellee Harold Young had a telephone conversation with Arnold D. Kamen, the principal partner of Arnold D. Kamen & Co., during which he suggested the establishment of a commodity brokerage branch office in Dallas. Mr. Kamen expressed interest and on August 28, 1967 flew to Dallas where he had a lengthy conference with Young. In this conference it was orally agreed that Young would open and operate a branch office for Arnold D. Kamen & Co. in Dallas with duties as office manager. Pursuant to the verbal agreement between the two men Young would be paid a percentage of the gross commissions plus a percentage of the commissions of any salesmen which he hired, less one-half of the expenses attributable to the Dallas office. It was also agreed that each of the salesmen which Young hired for the partnership would be personally responsible for the deficits in his customers' accounts. By the term 'deficits in customer accounts' was meant that where the required margin of a customer was depleted of funds and there was an actual deficit owed to Arnold D. Kamen & Co. by virtue of market losses. These deficits were referred to in the trade as 'red balances'.

To this point in the record there is no conflict in the testimony. However, the remaining provisions of the oral agreement of August 28, 1967 relating to the responsibility of Young for deficits or 'red balances' are sharply in conflict. Kamen testified that as a part of the oral agreement Young was to be personally responsible for 100 per cent of All deficits or 'red balances'.

Young unequivocally and positively denied Kamen's version of this part of the oral agreement. He said that when Kamen raised the question as to the possibility of 'red balances' and stated that he, Young, would be responsible for same that he absolutely refused to enter into such an agreement. He said that after much discussion it was agreed between him and Kamen that in the event 'red balances' should occur the parties would consider each one individually and then mutually agree on the disposition of such balances.

A branch office of Arnold D. Kamen & Co. was opened in Dallas approximately the first of September, 1967 with Harold Young as manager. Young continued to operate the office until July, 1968. At that time, due to controversies over deficits that has occurred, Young ceased to be manager but continued to work in the office as an employee for a short time. During the period when Young was manager of the office he employed several commodity salesmen with the understanding that each salesman would be personally responsible for his customers' deficit balances, if any. During the period between September, 1967 and June, 1968 the company transacted a large volume of commodity trading. Each month Young received a check for his commissions but testified that he did not receive a statement from Arnold D. Kamen & Co. which revealed the amount or itemization of deductions and charges from his gross commissions. During this time several customer deficits or 'red balances' occurred. Some were collected from the customer and others were not. In some instances when customer balances appeared to be in deficit Young personally agreed to accept responsibility for same. For example, in May, 1968 C. Calloway a customer of Young, incurred a deficit and Young expressly agreed that this might be applied to his commissions. In March and May of 1968 G. Young, the wife of Harold Young, incurred deficits in her account and in each instance Young agreed specifically to assume these deficits and permit the same to be charged against his commissions. In May of 1968 several customers had deficit balances but Mr. Young testified that he specifically refused to accept these deficits. However, Kamen & Co. did deduct the same on their records and charged them to Young's account. In July, 1968 due to the condition of the market nine customers of the Dallas branch office incurred considerable deficit balances due to losses in the commodity market. The total of these balances amounted to $30,584.80. The largest of these deficit balances was that of Dr. W. J. Langley which totaled more than $21,000.

Subsequent to these major losses in July, 1968 Young and Kamen had a conference in Dallas during which Young specifically denied that the nine deficits could be charged against his commissions.

While appellants attack only the jury finding in response to Issue No. 3 it is important to consider Issue No. 2 because Issue No. 3 was to be answered by the jury only in the event of an affirmative answer to Issue No. 2. The trial court submitted Issue No. 2 as stated above.

It is to be observed that Issue No. 2 was couched and framed in the very precise wording of appellants' pleading. In their answer appellants asserted that Young had agreed to have deducted 100 per cent of 'any' deficit customer balances. It was not alleged that Young had agreed to assume 'all' such balances. It is also to be observed that the issue as submitted does not relate to nor is it confined to a particular date or time. It obviously was intended to inquire as to the actual contract made by the parties and the term 'any' used therein was to be considered as it was by Young and Kamen. Moreover, when the Issue No. 2 was incorporated in the charge appellants leveled no objection to the form thereof. Thus, in effect, the jury in answer to Issue No. 2 found that Young had agreed to assume 'some' or 'any' of the deficit balances as testified by...